You might think that after announcing record results with a profit from UK car insurance at £219.2 million in the first six months of the year (as reported here
), Admiral Insurance would be on top of the world. However, it appears amid the celebrations there is no shortage of critics.
Step forward Thompsons Solicitors which has fired a few provocative queries the way of Admiral by issuing a statement on the back of the insurer’s results.
In its statement, Thompsons highlights that despite the motor insurance market becoming, in Admiral’s words, ‘increasingly rational’, motorists have seen premiums rise 17.2% in the last year. It highlights that Admiral’s earnings report made no mention of claims fraud being a problem and instead highlights that the firm has been able to increase reserve releases ‘due to positive claims cost development in the first half of 2016’.
The suggestion, of course, is that the consumer is losing out – and Thompsons highlights the recent study by data analysts WebberPhillips (which we reported on here
) that suggested insurance consumers living in multi-ethnic areas are being hit particularly hard.
“There is no suggestion that insurers are deliberately discriminating, but there are real grounds for concern when a section of the motoring public are having to pay more for their insurance based on factors beyond their control at the same time as the insurers are posting ever-growing profits and paying out significant dividends,” said Tom Jones, head of policy for Thompsons.
“For years, we have been told car insurers are struggling because of fraud - described by one insurer as a ‘pandemic’ - but yet again not only is there no mention of fraud in this half yearly report from Admiral, the company actually says claims costs are moving in a positive direction.
“Admiral’s bumper dividend announcement comes just two weeks after Direct Line, another giant in the UK car insurance market, reported it would pay £200 million in half-year dividends to shareholders come September. If some parts of the insurance industry talk up a ‘crisis’ whilst others coin it in, it’s the consumer who loses out.”
What do you make of Thompsons’ response to Admiral’s results? Leave a comment below with your thoughts.
Results are in for Admiral and Confused.com
Controversy over “ethnic penalties” in insurance